What is the long run equilibrium price for the type of tiles that Art-tile produces? Why? How many companies will produce this type of tile in long run equilibrium?
What is the long run equilibrium price for the type of tiles that Art-tile produces? Why? How many companies will produce this type of tile in long run equilibrium?
Economics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506725
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter24: Price-searcher Markets With High Entry Barriers
Section: Chapter Questions
Problem 13CQ
Related questions
Question
Art-tile operates in a market where there are a number of competitors and anyone could set up at operation like Art-tile by making the same initial financial commitment as Art. QM is the market demand for tiles and is described by the following demand curve;
Tiles | Workers | MC | TC | Revenue | ||
1000 | 10 | 8 | 20 | 8 | 22000 | 9000 |
2000 | 19 | 8 | 13.6 | 7.2 | 50000 | 18000 |
3000 | 27 | 7 | 11.2 | 6.4 | 93000 | 27000 |
4000 | 34 | 7 | 9.8 | 5.6 | 148000 | 36000 |
5000 | 41 | 7 | 9 | 5.6 | 217000 | 45000 |
6000 | 48 | 6 | 8.4 | 5.6 | 300000 | 54000 |
7000 | 58 | 7 | 8.3 | 8 | 418000 | 63000 |
8000 | 70 | 7 | 8.5 | 9.6 | 572000 | 72000 |
P = 40 - .0001QM
- What is the long run
equilibrium price for the type of tiles that Art-tile produces? Why?
- How many companies will produce this type of tile in long run equilibrium?
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 4 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
![Economics: Private and Public Choice (MindTap Cou…](https://www.bartleby.com/isbn_cover_images/9781305506725/9781305506725_smallCoverImage.gif)
Economics: Private and Public Choice (MindTap Cou…
Economics
ISBN:
9781305506725
Author:
James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:
Cengage Learning
![Microeconomics: Private and Public Choice (MindTa…](https://www.bartleby.com/isbn_cover_images/9781305506893/9781305506893_smallCoverImage.gif)
Microeconomics: Private and Public Choice (MindTa…
Economics
ISBN:
9781305506893
Author:
James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:
Cengage Learning
![Managerial Economics: Applications, Strategies an…](https://www.bartleby.com/isbn_cover_images/9781305506381/9781305506381_smallCoverImage.gif)
Managerial Economics: Applications, Strategies an…
Economics
ISBN:
9781305506381
Author:
James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:
Cengage Learning
![Economics: Private and Public Choice (MindTap Cou…](https://www.bartleby.com/isbn_cover_images/9781305506725/9781305506725_smallCoverImage.gif)
Economics: Private and Public Choice (MindTap Cou…
Economics
ISBN:
9781305506725
Author:
James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:
Cengage Learning
![Microeconomics: Private and Public Choice (MindTa…](https://www.bartleby.com/isbn_cover_images/9781305506893/9781305506893_smallCoverImage.gif)
Microeconomics: Private and Public Choice (MindTa…
Economics
ISBN:
9781305506893
Author:
James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:
Cengage Learning
![Managerial Economics: Applications, Strategies an…](https://www.bartleby.com/isbn_cover_images/9781305506381/9781305506381_smallCoverImage.gif)
Managerial Economics: Applications, Strategies an…
Economics
ISBN:
9781305506381
Author:
James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:
Cengage Learning
![Microeconomics: Principles & Policy](https://www.bartleby.com/isbn_cover_images/9781337794992/9781337794992_smallCoverImage.jpg)
Microeconomics: Principles & Policy
Economics
ISBN:
9781337794992
Author:
William J. Baumol, Alan S. Blinder, John L. Solow
Publisher:
Cengage Learning
![Essentials of Economics (MindTap Course List)](https://www.bartleby.com/isbn_cover_images/9781337091992/9781337091992_smallCoverImage.gif)
Essentials of Economics (MindTap Course List)
Economics
ISBN:
9781337091992
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
![Economics:](https://www.bartleby.com/isbn_cover_images/9781285859460/9781285859460_smallCoverImage.gif)